Russian President Vladimir Putin and Chinese authorities decided to form the strategic alliance for defense, trade and energy. Russia will deliver oil to China and China will collaborate with Russia in Geopolitical strategic defense of Euresia.

The article gets a tad carried away at the end, it's a bit early to be talking of a cold war I believe. But nonetheless, this, along with Europe continuing to unify and gain independance militarily and politically from the US, should make for an interesting situation in the near future.

East Asian hegemony will become an issue long before global hegemony can. The Indians and the Chinese will be at each others throats long before they're trying to bomb Pearl Harbor to prevent the US from ruling the world.

Poorly written editorial and poorly thought out as well. A good IR course that explains how balancing alliances function might be a good idea for this fellow...

the china and russian part is obvious - both parties have been very disturbed over US presence in central asia, located coincidentlly near the central asian olifields, which naturally these two major nations wish to keep as theirs... never mind the locals, as per normal.

this article seems to be in the same vein as the articles i posted about the return of the multi-polar world, but this goes further - it is saying these nations are atually forming a global, anti-US economic, political and military alliance.

this is generally bad, nevermind the current insane president of the US, none of these nations exactly have a great human rights record, some even making the US look bad (thats hard to do these days).

when empires grow, the normal person shrink... and usually end up killed whilst the Imperial War Pigs huddle in their bunkers, dreaming their mad dreams of conquest and power - instead of working out their insecurities over a game of diplomacy or risk.

that there needs to be a counterweight to the Imperial juggernaught of US power i would certainly agree with, but the adage of "the enemy of my enemy is my friend" has caused almost as much bloodshed as "the end justifies the means".

it would be far better if mankind were to create a humanist opposition to militarism, by forming coops and removing power from feudal bloodlines and Imperial Dynasties, but it seems the drive to armagedden will not be stopped.

i would say 'god help mankind', but it seems the god that refers to is a death god, and he IS helping mankind.

kylie: this is the first worthwhile post i have seen you make - what gives?

Right now, foreign investors own an incredible $7.3 trillion of U.S. assets.

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China's trade with the US alone: suprlus

Who is it that owns the rights on all the IOUs Washington, and others have been writing to fund the Iraq war and the current 'recovery?' Unbelievably, at least $120 billion in U.S. Treasurys alone is owned by the Chinese!

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China = lapdog

China could tell the United States to take a flying leap in a lake and there's not much we could do because if China decides to dump those huge holdings of U.S. debt, the U.S. economy is done for. (They also own a considerable amount of U.S. stocks. Corporate bonds-they're ALREADY begun dumping them!) The moment the sell signal comes, a bond market collapse, rising interest rates, even more dollar devastation and a crumbling stock market are all but guaranteed.

China could tell the United States to take a flying leap in a lake and there's not much we could do because if China decides to dump those huge holdings of U.S. debt, the U.S. economy is done for. (They also own a considerable amount of U.S. stocks. Corporate bonds-they're ALREADY begun dumping them!) The moment the sell signal comes, a bond market collapse, rising interest rates, even more dollar devastation and a crumbling stock market are all but guaranteed.

And you know why they havent done ths already?

All that nice FDI that grows their economy, that nice US market to sell stuff to.

There is a reason its call interdependence.

And why hasnt anyone declared the SCO as an evil Sino-Russian plot to stop America? Really, if we are going to assume all things as part of the formation of a giant anti-american alliance we really should have started there.

Right now, foreign investors own an incredible $7.3 trillion of U.S. assets.

the US produced more than 10 trillion dollars worth of goods and services. what they own doesn't even match what we could produce each year. a miniscule amount in the US economy. and by the way, lowell, what they own in US assets have NOTHING TO DO WITH THE TRADE FLOW.

economics is clearly too difficult of a subject for you. stick with anti-bush rhetoric.

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Who is it that owns the rights on all the IOUs Washington, and others have been writing to fund the Iraq war and the current 'recovery?' Unbelievably, at least $120 billion in U.S. Treasurys alone is owned by the Chinese!

Let's see...The US owns 80% of the IOUs. ALL foreigners combined for the other 20%. So my answer to your question is, the US government owns most of the IOUs.

Even if you wish to exaggerate the Chinese control, I hope you will in the future not propagating this kind of misinformaton on the board. This kind of misinformation only fuels the anti-Chinese sentiment over its growing power in international trade.

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China could tell the United States to take a flying leap in a lake and there's not much we could do because if China decides to dump those huge holdings of U.S. debt, the U.S. economy is done for. (They also own a considerable amount of U.S. stocks. Corporate bonds-they're ALREADY begun dumping them!) The moment the sell signal comes, a bond market collapse, rising interest rates, even more dollar devastation and a crumbling stock market are all but guaranteed.

Let me run this number through you again:Chinese trade with the rest of the world: deficitsChinese trade with the US: surplus

The entire trade balance is hinged on the resiliency and buying power of America. If China wants to ruin its most profitable trading partner, China is dead, gone, poof, adios.

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Member No.: 110

First why does this Alliance between the Russian Government that is headed by the guy that used to run the KGB of the old Soviet Union and the Chicoms?

Look at it from the Russian prespective. The Chicoms are willing to play and hate the West. The Rusians have for all intents and purposes lost Eastern Europe, the Stans of Central Asia and the Ukraine to NATO. Now the hated Capitalists or the hated free democracies are closer to the heart land and have stolen the Ukrane. To thell the truth the elections in the Ukrane could have hurt Putin more than many know.

So this in a way makes sense. It gives a market for the sub-standard Russian gear and a market for the Chinese slave labor goods with out having to do something to enter the markets of the Western World.

It also gives cover for the North Korean Necular Arms because we all know that the North Koreans wouldn't have had a nuclear weapons program if it wasn't for Red China and some old Soviet buddies.

The more the world changes the more it stays the same.

The wooing of India also makes sense in a way. Many have speculated on a "English speaking World" strategic alliance forming almost spontaniously.

Thats projected right? We all know how good our government is with numbers.

incorrect. the US has maintained this figure for many years.

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Current account balance Ranked by countries

i understand that economics is difficult, which forced you to randomly draw whatever numbers you have the access to. Sadly, current account balance of each country tells NOTHING about how much US assets they own. Current account balance is the trade and investment flow, it has nothing to do with the amount of US assets they could own.

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I know one thing If you got more being imported then exported you are dependant on other countries to fill your needs.

Exports by countries

Imports by countries

Really? Because you would be dead wrong.US could easily switch to labor-intensive goods and services if China refuses to send us their goods. So, here is the question: If China depends on the US to buy its products, who holds more power? The buyer, or the producer?

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Yea that is why we have the highest External debt Ranked by countries.

I don't know what the figure has anything to do with the fact that the US still owns 80% of its own debt, contrary to your suggestion that 100% of the debt is owned by China.

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Misinformation?

China exports to america is 12.5%.

America exports to china is 8.2%.

I think that proves China has more grip on us then we do them. And that is not adding all the stocks, bonds, and other investment the chinese has in america.

Like I said, if China refuses to give us their cheap Nikes and T-shirts, Americans could produce them just as easily. So, China is more than welcome to stop selling us their goods. But if they want our money, then they better behave. Very simple.

Remember, customer is always right. No one says the seller is always right. And US is the biggest customer.

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[MF's claim that China runs trade deficits with the rest of the world is] Not true, care to back this up with some facts?

Not a problem. And unlike you, I will actually provide relevant data. To wit:

the article stated that: While China is running a large ($100 bn in 2002) bilateral trade surplus with the US, its trade balance with the rest of the world is in deficit, at $75 bn." From today's Financial Times

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True we have gave China surplus which has help them create there own economy. Which has boosted them to start the course of as ranking as a super power.

If trade surplus creates superpower, then Portugal should have been a superpower too... oh wait, maybe Taiwan is a superpower? Oh, I know! Argentina. This superpower in 'Africa' has wrecked havoc around the world. It has the power to attack Iraq, occupy Afghanistan, and threaten Iran.... oh wait...

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Where do you get your facts?

Nearly 10 years of training in economics. For example, many facts could be obtained from top jounrals such as this one.

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True America is china most profitable exporter. But with surplus they could afford to stop trade with us and find some other countries to take the place of the american 21.1% worth of exports.

Riiiiight. go find a place where you could find a partner that could take 21% of your products.

What I don't understand is what India gets from this alliance. Relations between the PRC and India have generally been hideous. All I can think of is a deal where the PRC won't give knee-jerk support to Pakistan the next time India and Pakistan start rattling sabers.

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Baron, Puzzle it out.

QWOT,

India has a relationship, or had one with the Soviet Union in the good old days. We had a relationship with pakistan and they hated pakistan and the Reds used that to "counter balance" US influence in the region.

What would they get from a current alliance? Probably little.

But remember the dynamic has changed. So what we may be seeing is Putin and the Chicoms wanting to relive the "good old days" where they were world players.

incorrect. the US has maintained this figure for many years.i understand that economics is difficult, which forced you to randomly draw whatever numbers you have the access to.

Once agian you fail to see our federal reserve notes slide in relative value against foreign currencies. The personal wealth of the American public has taken a severe hit with the declines in equities. But the relative safety of bonds and fixed instruments are also under assault because the there is no immunity from a contrived contraction of the American economy.

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Sadly, current account balance of each country tells NOTHING about how much US assets they own. Current account balance is the trade and investment flow, it has nothing to do with the amount of US assets they could own.

The United States trade deficit outflow drains national wealth.

Forbes magazine reports:

"Although final figures are not yet in, analysts believe the United States imported some $425 billion more in goods and services in 2002 than it exported, which would mark a record."

Goldman Sachs, in a recent report, anticipated a larger trade deficit in 2003, saying that would trim about one-quarter of one percent from U.S. economic growth.

Now Forbes points to: "The gap in the current account, the widest measure of trade because it includes investment income flows, has been a nagging worry for Federal Reserve officials and private economists alike. They fret that the roughly $500 billion current account deficit is <b>unsustainable</b> over the long run, leaving the currency vulnerable to heavy selling in the event of an abrupt correction in the balance."

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Really? Because you would be dead wrong. US could easily switch to labor-intensive goods and services if China refuses to send us their goods.

I agree we could but them days where we had protection based upon the ability to work your way out of a recession is not an option, when the indigenous economy consists of pseudo professions, superfluous services, government toadies, and insatiable public demanding a higher spending.

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So, here is the question: If China depends on the US to buy its products, who holds more power? The buyer, or the producer?

China trade policy has been reducing the independence of America for many years now and integrate it into an international economy. Our trade deficits are integral to trading away our future. Our economy is walking the high wire and the net that is supposed to save us is foreign import. You should already know this background and appreciate its significance. But what may have escaped your observations is that the twin terror of a deflating domestic economy can be accompanied with the horror of rising prices. Here is why you should be concerned. The United States now exports high tech systems, military armaments and sophisticated technology that allows foreign competitors to lower the costs of their own production, while the short term cash inflow disguises the root causes of the trade deficit. Couple this course with the lowering of the purchasing power on the US Dollar, and you experience higher prices at the consumer level. Since domestic jobs are non existent to produce our own home-made supplies, we are unable to escape this disastrous cycle.

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I don't know what the figure has anything to do with the fact that the US still owns 80% of its own debt, contrary to your suggestion that 100% of the debt is owned by China.

LOL...Where did I suggestion that 100% of the debt is owned by China? Where do you get this figure that the US still owns 80% of its own debt? what happens to exports when our domestic economy no longer manufactures any meaningful consumer product for overseas consumption?

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And unlike you, I will actually provide relevant data.

No, I did provide relevant data.

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If trade surplus creates superpower, then Portugal should have been a superpower too... oh wait, maybe Taiwan is a superpower?

China is providing Electricity for 1.4 Billion People.

Education is Free threw university.

China is the Third Nation to send a Man into Space on a Locally made rocket. They have plans for Space Probes within 5 years, Men on the moon within fifteen and bases within twenty. China has made great strides in spacecraft development, and has no shortage of Engineers and a good-sized wallet to get them there.

Military age and obligation: 18 years of age for compulsory military service, with 24-month service obligation; no minimum age for voluntary service; 17 years of age for women who meet requirements for specific military jobs.

Military manpower availability: males age 15-49: 379,524,688

Military manpower fit for military service: males age 15-49: 208,143,352

Military manpower reaching military age annually: males: 12,494,201

Military expenditures - dollar figure: $60 billion (2003 est.)

Military expenditures % of GDP: 3.5-5.0% (FY03 est.)

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It has the power to attack Iraq, occupy Afghanistan, and threaten Iran.... oh wait...

We don't have many troops in Afghanistan. But by your threoy North korea is a super Power because they got nukes and have been threating the South Korea, U.S. and japan.

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Riiiiight. go find a place where you could find a partner that could take 21% of your products.

You don't need just one partner to take all 21% you could very eazy split that into a few different countries. Like Iran, France, Russia, Saudi Arabia, Cuba, India, and many others. There is a huge market out there.